The vertebrate embryo undergoes a series of dramatic morphological changes as the body extends to form the complete anterior-posterior axis during the somite-forming stages. The molecular mechanisms regulating these complex processes are still largely unknown. We show that the Hippo pathway transcriptional coactivators Yap1 and Wwtr1 are specifically localized to the presumptive epidermis and notochord, and play a critical and unexpected role in posterior body extension by regulating Fibronectin assembly underneath the presumptive epidermis and surrounding the notochord. We further find that Yap1 and Wwtr1, also via Fibronectin, have an essential role in the epidermal morphogenesis necessary to form the initial dorsal and ventral fins, a process previously thought to involve bending of an epithelial sheet, but which we now show involves concerted active cell movement. Our results reveal how the Hippo pathway transcriptional program, localized to two specific tissues, acts to control essential morphological events in the vertebrate embryo.